Daily Market Analysis (SHORT TERM) Friday 01/04/2013

Confirmation of a bottom with a range violation on 12/31/12 @ 1677.90. Confirmation of a bottom with a close violation on 12/31/12 @ 1675.80. Upside Target = 1692.40 – 1716.80

February Gold dropped sharply lower in afternoon trading on Thursday on the heels of the FOMC report to last trade just off the session’s low.

Look for gold to continue the decline lower on Friday, possibly generating an outside week to the downside and negating all the positive momentum established over the past week as it seeks to retest the December lows at $1,636.

Confirmation of a top with a range violation on 01/02/12 @ 1.3174. Confirmation of a top with a close violation on 12/21/12 @ 1.3187. Downside Targets = 1.3093 – 1.3036.

Bearish ERVB generated on Thursday making new lows on the current move @ 1.3055.

The March Euro FX fell sharply lower on Thursday as the USD had one of its best days against the FX currencies with the hinting of the end of the various Fed QE programs.

While the market may continue to see a ST setback lower, traders should look to buy aggressively if the market becomes oversold into previous levels of support near 1.29 and expect the 2012 highs to be broken during Q1 2013.

Confirmation of a bottom with a range violation on 12/31/12 @ 1417.00. Confirmation of a bottom with a close violation on 12/31/12 @ 1420.00. Upside Targets = 1452.00 – 1471.50.

New highs made on current move Thursday @ 1460.50.

The March S&Ps once again traded outside the daily RBB on Thursday but faltered late in the session after its best New Year’s gain ever.

This market has been buoyed the last three sessions on the backside of a fiscal cliff deal but investors need to remember that the most pressing issue our country faces, the staggering debt, was not tended to and should be ready for a very volatile next couple of months full of partisan bickering.

About the Author

KMH is a trading and technical analysis firm that specializes in commodity futures and commodity based ETF’s. Kris Hicks has worked for numerous years in the commodity business and in 2011 accurately forecasted both $25 moves to the downside in May and July and the $25+ move to the upside in October in oil. He also called the all-time high day for gold on Sept. 6, 2011 and forecasted a projected downside target of 1528.10 in March 2012. He was also responsible for projecting the Q2 and Q4 low in the Euro FX to within 13 and 9 ticks, respectively. His trading methodology has a high degree of accuracy which confirms tops/bottoms, projected trading ranges and projected targets for those ranges. His expertise is focused on 16 commodities plus the comparable ETF markets. You can reach Kris at Kris@KMH-Capital.com or visit his website at www.KMH-Capital.com.